(Editor's note: Occasionally, we ask an insurance technologyleader a single question to elicit a response that will enlightenand inform the Technology channel readership. If you would like toparticipate, contact the editor at [email protected])

Question: What is the total cost of ownership for trueconfigurability?

Heather Peacock is executive vice president forOneShield, Inc.: True configurability can reduce the totalcost of ownership (TCO) by minimizing or eliminating expensiveprofessional services during and after the implementation, and byenabling internal users to gain operational and processefficiencies, as well as product and market agility withoutinvolving in-demand IT resources.

True configurability requires a design tool that goesbeyond just the definition of functional insuranceproducts, including rates, rules, forms and product definitions.However, it must extend to all aspects of the insurance enterprise,including processes, organizational structure, and the insurer'secosystem of suppliers, distribution channels and customers. Theconfiguration capabilities of the design tool should extend toobject model, partner and customer management, security, workflowmanagement, user interface and integration.

When insurers move to configurability beyond product,operational efficiencies that were not possible before can beidentified more easily, as evidenced in the examples below:

• With a configurable workflow and business partner management,reinsurers can be brought into the process much earlier, and cancollaborate with an insurer's underwriters to construct policiesrequiring facultative reinsurance.
• With configurable asynchronous processing, insurers canconstruct bespoke processes to solicit business from lost prospectsearly enough in the renewal season that the chances of getting thebusiness are improved dramatically.
• With configurable presentation, insurers can technology-enableMGA partners to put up program business websites aimed atparticular markets.

As a result of being highly extensible, a configurable systemdoes not require the costly investments of time, money and effortassociated with coding, which can lead to substantialimplementation and long-term maintenance costs. Insurers stand togain significantly with regards to improving service levels, costcontrols, operational savings, streamlining enterprise businessprocesses and achieving a more customer-centric view when aconfigurable system is leveraged to its full potential.

Heather Peacock is executive vice president for OneShield,Inc. She can be reached for further comment via email at [email protected].